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2014 Annual Survey of Philippine Business and Industry (ASPBI) - Other Service Activities Sector : Final Results

Reference Number:

2017-067

Release Date:

Thursday, March 16, 2017

Personal services for wellness dominates other service activities sector

Based on the final results of the 2014 Annual Survey of Philippine Business and Industry, there were 10,707 establishments in the formal sector of the economy engaged in Other service activities. A total of 10,244 establishments or 95.8 percent had a total employment (TE) of less than 20 while 463 or 4.2 percent were establishments with TE of 20 and over.

Among the industries, personal services for wellness, except sports activities topped the sector with 6,236 establishments or 58.2 percent of the total. This was followed by laundry services with 1,618 establishments (15.1%). Funeral and related services ranked third with 1,477 establishments or 13.8 percent. Figure 1 shows the percentage distribution of other service activities sector for all establishments by industry group in 2014.

Personal services for wellness generates the highest employment

Employment for the sector reached a total of 78,967 workers in 2014. Paid employees accounted for 75,072 or 95.1 percent and the remaining 3,895 or 4.9 percent were working owners and unpaid workers. Almost 80.0 percent of the total employees or 62,334 workers were hired by establishments with TE of less than 20 and the remaining workers of 16,632 (21.1%) worked in establishments with TE of 20 and over.

Among industries, personal services for wellness, except sports activities had the highest number of employees with 52,598 (66.6%). Funeral and related activities ranked second with 9,542 or 12.1 percent while repair of personal and household goods industry was third with 7,648 or 9.7 percent. Distribution of employment by industry group for the sector is shown in Figure 2.

Repair of computers and communications equipment pays the highest compensation

Total compensation paid by other service activities sector amounted to PHP7.7 billion, translating to an average annual compensation of PHP103.2 thousand per employee. For establishments with TE of 20 and over, the total compensation reached PHP2.5 billion. On the other hand, establishments with less than 20 paid PHP5.3 billion.

Across industry group, repair of computers and communications equipment paid the highest average annual compensation of PHP215.2 thousand per employee, followed by domestic services and other personal service activities, n.e.c., with a combined annual compensation of PHP119.0 thousand. On the other hand, employees of laundry services industry had the lowest average annual pay of PHP87.9 thousand per employee. Figure 3 shows the average annual compensation per employee for other service activities sector by industry group.

Total income amounts to PHP49.4 billion

Gross income earned in 2014 by other service activities sector reached PHP49.4 billion. About PHP35.9 billion or 72.7 percent of the gross income was contributed by establishments with TE of less than 20 and the remaining PHP13.5 billion was generated by establishments with 20 and over.

Personal services for wellness, except sports activities industry was the top contributor with income of PHP35.6 billion or 71.9 percent of the total. This was followed by funeral and related activities industry with PHP4.9 billion (10.0%). Domestic services and other personal service activities, n.e.c. had the least income of PHP465.7 million.

Total expense reach PHP43.1 billion

Total expense incurred by the sector summed up to PHP43.1 billion. Personal services for wellness, except sports activities industry was the highest spender in 2014, with PHP30.8 billion (71.5%), followed by funeral and related activities with payments of PHP4.2 billion (9.8%). Domestic services and other personal service activities, n.e.c. industries had the least expense, with a combined spending of PHP453.5 million.

Income per peso expense stands at 1.15

The income generated per peso expense was computed at 1.15. This means that for every peso spent in the operation of the business, a PHP1.15 income was generated. Among industries, laundry services industry recorded the highest at 1.21 income per peso expense. This was followed by funeral and related activities, with a ratio of 1.16. Domestic services and other personal service activities, n.e.c. recorded the least ratio, with 1.03 per peso expense.

Value added amounts to PHP17.0 billion

Value added for the sector was estimated at PHP17.0 billion. For establishments with TE of 20 and over, value added was PHP5.0 billion while for establishments with TE less than 20, value added was PHP12.0 billion.

Personal services for wellness, except sports activities contributed PHP12.0 billion (70.7%) of the total value added. Funeral and related activities had a total value added of PHP1.9 billion or (11.4%) while repair of personal and household goods industry provided PHP1.3 billion or 7.4 percent. The least value added was accounted for by domestic services and other personal service activities, n.e.c. with PHP52.2 million (0.3%). Figure 5 shows the distribution of value added for other service activities by industry group.

Employees of repair of computers and communications equipment are the most productive in 2014

Value added per worker, a measure of labor productivity, was valued at PHP215.0 thousand in 2014. Among industries, repair of computers and communications equipment had the highest average of PHP310.9 thousand. Ranked second and third were personal services for wellness, except sports activities and funeral and related activities, with PHP228.3 thousand and PHP202.5 thousand, respectively. Laundry services industry posted the least value added per employee of PHP150.7 thousand.

Gross addition to fixed assets accumulates to PHP456.0 million

Gross addition to fixed assets in 2014 totaled to about PHP456.0 million. Establishment with TE of 20 over recorded PHP162.1 million while establishments with TE of less than 20 reached PHP293.9 million.

Personal services for wellness, except sports activities industry recorded the highest addition to fixed assets amounting to PHP257.3 million (56.4%). Funeral and related activities had PHP129.9 million (28.5%) while domestic services and other personal service activities, n.e.c. recorded the least of PHP4.5 million.

Laundry services posted the highest total change in inventories in 2014

Change in inventories, defined as the value of ending less the beginning inventory. Three industries recorded a positive change in inventories as follows:

Laundry services, PHP13.2 million;

Repair of personal and household goods, PHP7.2 million; and

Repair of computers and communications equipment, PHP4.1 million.

Subsidies and sales of E-commerce

Subsidies are all special grants in the form of financial assistance or tax exemption or tax privilege given by the government and E-commerce refers to the selling of product or services over electronic systems such as the Internet Protocol-based networks and other computer networks. There were no reported subsidies and sales from E-commerce for other service activities sector in 2014.

TECHNICAL NOTES

Introduction

This Special Release presents the final results of the 2014 Annual Survey of Philippine Business and Industry (ASPBI) for the Other services activities sector for all establishments in the formal sector of the economy.

The 2014 ASPBI is one of the designated statistical activities of the Philippine Statistics Authority (PSA). Data collected from the survey will provide information on the levels, structure, performance and trends of economic activities of the formal sector of the economy for year 2014. It will also serve as benchmark information in the measurement and comparison of national and regional economic growth.

The survey was conducted nationwide in April 2015 with the year 2014 as the reference period of data, except for employment which is as of November 15, 2014..

Data are presented at the national, regional and industry group or 3-digit 2009 Philippine Standard Industrial Classification (PSIC). .

Data collection was intensified through the use of web-based or online accomplishment of questionnaire through the PSA website and downloading of e-questionnaire and submission thru email..

Legal Authority

The conduct of the 2014 ASPBI is authorized under Republic Act 10625 known as the Philippine Statistical Act of 2013 - Reorganizing and strengthening of the Philippine Statistical System (PSS), its agencies and instrumentalities.

Scope and Coverage

The 2014 ASPBI is a nationwide undertaking confined to the formal sector of the economy and as such excluded the informal sector. The following comprise the formal sector:

Corporations and partnerships

Cooperatives and foundations

Single establishment with employment of 10 or more

Single proprietorship with branches

Hence, the 2014 ASPBI covered only the following economic units:

All establishments with total employment (TE) of 10 or more, and;

All establishments with TE of less than 10, except those establishments with Legal Organization = 1 (single proprietorship) and Economic Organization = 1 (single establishment), that are engaged in economic activities classified according to the 2009 Philippine Standard Industrial Classification (PSIC).

The initial estimate of the 2014 LE shows that there are about 944,500 establishments in operation in the country for the year. About 266,000 establishments (28% of the total establishments) belong to the Formal Sector of which 231,000 (87%) comprise the establishment frame.

Listed below are the 18 economic sectors within the scope of the 2014 ASPBI classified under the 2009 PSIC.

Sampling Design

Unit of Enumeration

The unit of enumeration for the 2014 ASPBI is the establishment. An establishment is defined as an economic unit, which engages, under a single ownership or control, in one or predominantly one kind of activity at a single fixed physical location.

Classification of Establishments

Economic Organization (EO) refers to the organizational structure or role of the establishment in the organization.

Legal Organization (LO) refers to the legal form of the economic entity that provides the legal basis for ownership of the establishment.

Industrial Classification is determined by the activity from which it derives its major income or revenue. The 2009 PSIC which was approved for adoption by government agencies and instrumentalities through NSCB Resolution No. 2 Series 2010 was utilized to classify economic units according to their economic activities.

Size (SZ) of the Unit of Enumeration is determined by its total employment (TE) as of specific date. Total employment (TE) refers to the total number of persons who work in or for the establishment. This includes paid employees, working owners, unpaid workers and all employees who work full-time or part-time including seasonal workers. Included also are persons on short term leave such as those on sick, vacation or annual leaves and on strike.

Geographic Classification is grouping of establishments by geographic area using the Philippine Standard Geographic Code (PSGC) classification. The PSGC contains the latest updates on the official number of regions, provinces, cities, municipalities, and barangays in the Philippines. The PSGC as of December 31, 2014 was used for the 2014 ASPBI.

Sampling Design

Selection of sample establishment for the 2014 ASPBI was done using stratified systematic sampling with 3-digit or 5-digit PSIC serving as industry strata and employment size as the second stratification variable.

Estimation Procedure

For Establishments with TE of Less Than 20

a. Non-Certainty Stratum

The estimate of the total of a characteristic for the non-certainty employment stratum TE less than 20 in the sth industry domain was

where:

s = denotes the non-certainty employment strata in TE of less than 20

Xsj = value of the jth establishment in non-certainty employment stratum in TE of less than 20 in Sth industry domain

j = 1,2,3..., ns establishments

Wsj = weight of the jth establishment in the non-certainty employment stratum of less than 20 in the sth industry domain

Ns = total number of establishments in the non-certainty employment stratum in TE of less than 20 in the sth industry domain

ns = number of sample establishments in the non-certainty employment stratum in TE of less than 20 in sth domain

b. Certainty Stratum

The total of a characteristic for the certainty employment stratum in the Cth industry domain was

where:

c = denotes the certainty employment strata in TE of less than 20 in the cth industry

xcj = value of the jth establishment in the certainty employment strata in TE of less than 20 in the cth industry domain

j = 1,2,3,..., mc establishments

mc = number of establishments in the certainty employment strata in TE of less than 20 in the cth industry domain

c. Total Estimate for TE of Less Than 20

For all sections except B and C, national level estimates of the total of a characteristic for the industry domain was obtain by aggregating the estimates for all employment strata (non-certainty and certainty) in the same industry domain,

The estimate of the total of a characteristic for the non-certainty employment strata in TE of 20 and over for selected industry domain in each region was as

where:

s = denotes the non-certainty employment strata in TE 20 and over

p = 1,2,...,17 regions geographic domains

xspj = value of the jth establishment in the certainty employment strata in TE of 20 and over for an industry domain in each region

j = 1,2,3..., nsp establishments

Wspj = weight of the jth establishment in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

Nsp = total number of establishments in the non-certainty employment strata in TE of 20 and over for anindustry domain in each region

nsp = number of sample establishments in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

b. Certainty Stratum

The the total of a characteristic for the certainty employment stratum in TE of 20 and over in an industry domain in each region was

where:

c = denotes the non-certainty employment strata in TE of 20 and over

p = 1,2,...17, regions (geographic domains)

xcpj = value of the jth establishment in the certainty employment strata in TE of 20 and over in an industry domain within each region

j = 1,2,3..., mcp establishment

mcp = number of establishments in the certainty strata in TE of 20 and over in anindustry domain in each region

c. Total Estimate for TE of 20 and Over

The estimate of the total of a characteristic for the industry domain in each (geographic domain) was obtained by aggregating the estimates for all employment strata (non-certainty and certainty) in the same industry

where dp denotes the industry domains in each region.

National level estimates of the characteristics by industry domain were obtained by aggregating separately the estimates (Xdp) for the particular industry domain from all the regions.

Weight Adjustment Factor for Non-Response

To account for non-response in the non-certainty strata, the adjustment factor (n/n’) was multiplied with the sampling weight (W) of each of the sampling unit. The sampling weight, defined as N/n, was recomputed as

Thus, the adjusted weight (W’sj) for employment stratum in TE 1-9 or TE 10-19 was

where:

Ns= total number of establisments in the employment stratum in TE 1-9 or TE 10-19 in the sth industry domain

n's = number of responding establishments in the employment stratum in TE 1-9 or TE 10-19 in the sth industry domain

For the non-certainty employment stratum for the selected industry domain with TE 20-99, the adjusted weight (W'spj) was

where:

Nsp = total number of establisments in the non-certainty employment stratum with TE 20-99 for the selected industry domain within each geographic domain (region)

n'sp = number of responding establishments in the non-certainty employment stratum with TE 20-99 for the selected industry domain within each geographic domain (region)

Questionaire Design

The questionnaire design is basically the same as that of the 2012 Census of Philippine Business and Industry. However, changes were made in the disaggregation of data items for fixed assets in support to the requirements of the 2008 Systems of National Accounts with respect to the generation of fixed capital formation.

The sample establishments responded also to the survey through the use of Web-based version of the 2014 ASPBI questionnaires which was accomplished online at the PSA website. Likewise, an e-questionnaire was also downloaded and submitted thru e-mail.

Response Rate

Field operations of the 2014 ASPBI were scheduled from April to July 2015.

Total response rate for Other service activities sector was 96.5 percent (1,334 out of 1,383 establishments). This included receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.

Of the total responses, 27 establishments responded online.

Concepts and Definitions of Terms

Establishment is an economic unit under a single ownership control, i.e., under a single entity, engaged in one or predominantly one kind of economic activity at a single fixed location.

Total Employment is the number of persons who worked in for the establishment as of November 15, 2014.

Paid employeesare all full-time and part-time employees working in or for the establishment and receiving pay, as well as those working away from the establishment and paid by and under the control of the establishment. Included also are all employees on sick or maternity leave, paid vacation or holiday and on strike. Excluded are directors paid solely for their attendance at meetings, consultants, workers on indefinite leave, working owners who do not receive regular pay, home workers and workers receiving pure commissions only.

Unpaid workersare working owners who do not receive regular pay, apprentices and learners without regular pay and persons working for at least 1/3 of the working time normal to the establishment without regular pay. Excluded are silent or inactive business partners.

Compensationis the sum of salaries and wages, separation, terminal pay and gratuities paid by the establishment to its employees and total employer’s contribution to SSS/GSIS, ECC, PhilHealth, Pag-ibig, etc.

Salaries and wagesare payments in cash or in kind to all employees, prior to deductions for employee’s contributions to SSS/GSIS, withholding tax, etc. Included are total basic pay, overtime pay and other benefits.

Income or Revenue includes cash received and receivables for goods/products and by-products sold and services rendered. Valuation is at producer prices (ex-establishment) net of discounts and allowances, including duties and taxes but excluding subsidies.

Cost refers to all expenses incurred during the year whether paid or payable. Valuation is at purchaser prices including taxes and other charges, net of rebates, returns and allowances. Goods and services received by the establishment from other establishments of the same enterprise are valued as though purchased.

Expenserefers to cost incurred by the establishment during the year whether paid or payable. This is treated on a consumed basis. Valuation is at purchaser price including taxes and other charges, net of rebates, returns and allowances. Goods and services received by the establishment from other establishments of the same enterprise are valued as though purchased.

Value Addedis gross output less intermediate input. Computation of gross output for other service activities sector is presented below.

Gross output (for Other service activities sector)is equal to the sum of total income (less interest income, rent income from land, dividend income, royalty income and franchise income), capital expenditures of fixed assets produced on own account, and change in inventory.

Intermediate inputis equal to the sum of the following expense items: materials and supplies; fuels, lubricants, oils and greases; electricity and water; industrial services done by others; non-industrial services done by others (less rent expense for land); goods purchased for resale; research and experimental development expense; environmental protection expense; royalty fee; franchise fee and other expense; less change in inventory of materials and supplies; fuels, lubricants, oils and greases; and goods for resale.

Gross addition to tangible fixed assets is equal to capital expenditures less sale of fixed assets, including land.

Change in total inventories is computed as the total of ending inventory less the total beginning inventory.

Inventoriesrefer to the stock of goods owned by and under the control of the establishment as of a fixed date, regardless of where the stocks are located. Valuation is at current replacement cost in purchaser prices. Replacement cost is the cost of an item in terms of its present price rather than its original cost.

Subsidiesare all special grants in the form of financial assistance or tax exemption or tax privilege given by the government to aid and develop an industry.

E-Commercerefers to the selling of products or services over electronic systems such as the Internet Protocol-based networks and other computer networks, Electronic Data Interchange (EDI) network, or other on-line system.